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TMI Blog2004 (1) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... d levied tax on the first purchase of rice husk. If the paddy husk is a rice husk then being a first purchaser, dealer-opp. party is liable to tax under the aforesaid Notification and if the paddy husk is not rice husk, they may not be liable to tax under the said Notification. Case of revenue is that the paddy husk is nothing but rice husk is therefore, liable to tax under the Notification no. 5787, dated 7th September, 1981 and 3712, dated 5th June, 1985. Case of dealer is that the paddy husk and rice husk are different commodities and since and the paddy husk is not covered under the Notification Nos. 5787, dated 7th September, 1981 and 3712, dated 5th June, 1985, therefore, purcahses of paddy husk is not liable to tax in the hand of dealer-opp. party as a first purchaser. 3. Heard Counsel for the parties. 4. At this stage, it is relevant to refer Notifications relating to rise husk:- 1. Notification No. ST-II-5787/X-(10)-80-U.P. Act 15/48-Order-81, dated 7th September, 1981: Rice polish, Rice Bran and Rice @ 4 per cent at the first purchase. 2. Notification No. ST-II-3712/X-6(1)/85-U.P. Act-15/48-Order-85, dated 5th June, 1985: Rice polish, Rice bran and rice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e outer covering of paddy, is a separate item than rice husk. He submitted that subsequent Notification can be considered while interpreting the meaning of word rice husk given in the Notification Nos. 5787, dated 7th September, 1981 and 3712, dated 5th June, 1985. In support of his contention, he relied on the decisions of Hon'ble Supreme Court in the case of M/s. Pappu Sweets and Biscuits v. Commissioner of Trade Tax, reported in 1998 U.P.T.C. 1086. He further submitted that vide Circular, dated 28th February, 2001, Deputy Commissioner (Legal), Trade Tax, U.P. from the office of Commissioner of Trade Tax, U.P. circulated that the Government vide letter dated 20th February, 2001 has informed that prior from the period of 1st October, 2000, tax imposed on the paddy husk, tax assessed on the outer covering of paddy treating it as a paddy husk, has been waived and therefore, revenue should have filed the present revisions for the period prior to 1st October, 2000. 7. I have perused the order of Tribunal and authorities below: 12. According to the facts of all the appeals, the assessee/appellants have purchased paddy husk (Dhan Ki Bhusi) in the present case and it can be sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18.8-23.3 Calcium, mg/g 06-1.3 Phosphorus, mg/g 0.3-7.0 Neutral detergent fibre, % 66-74 Acide detergent fibre % 58.02 Lignin, % 9-20 Cellulose % 28-36 Pentosans, % 21-22 Hemcellulosses, % 12 Total digestiblenutrients, % 9.3-9.5 At 14 per cent mosture, Date from Miller and Eisenhauer (1982), Morrison (1956) NRC (1978) Kim 1981, and IRRI (1983). 13. A perusal of the report of the Pant Nagar University which has been filed by the department, it is very much clear that the paddy husk or the rice husk does not have oil content. It is the intention of the Legislature in the present Notification that only that rice husk is taxable, from which oil can be extracted. 14. The appellants have purchased paddy husk, but according to the department, it is the rice husk. Now the question in the present case is whether t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k is removed, the unfinished rice comes in the picture. 31. Notification No. ST-II-37 12/X-6( 1 )/-85-U.P. Act No. 15/48 Ordinance 85, published in U. P. Gazette, dated 15th June, 1985, which has also been noted above runs as follows: (18) Rice Polish, Rice bran and rice husk, but excluding de-oiled rice bran rice husk or de-oiled rice polish are taxable. This Notification has been issued after the pronouncement of the judgment of the Hon'ble High Court in the case of Commissioner of Sales Tax v. Naveen Traders, Etawah. This judgment has been pronounced in 27th March, 1973. The Hon'ble High Court has held in this judgment as has also been discussed above, that more over it is clear from the evidence recorded that the rice bran in respect of which the exemption is claimed is the powdered rice, which is obtained in polishing process. It is difficult to appreciate how this powdered form of the rice can be turned as Bhusi or rice. Bhusi is nothing, but a fine form of bhusi, which in turn is obtained by thrashing of stems, leaves and the outer husk of the grains. The rice bran in question, as has been seen, is obtained during the polishing process of the grains itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ategory of cattle fodder is not acceptable to us. 34. After making a careful scruting of all the records, going through the case laws on which our attention has been invited by both the parties and seeing all the circumstances of the case, we are of the opinion that the commodity in question is a paddy husk and is not taxable at the point of first purchaser, i.e. in the hands of the appellants in question. Therefore, the appellate in question are liable to be declared as non-assessable on such purchases of paddy husk. 8. I do not find any force in the argument of learned Standing Counsel. Subsequent Notification shows that paddy husk and rice husk have been treated as two different commodities shows that rice husk having contents of oil element, is only included in the Notification No. 5787 dated 8th September, 1981 and Notification No. 3217, dated 15th June, 1985 appears to be logical. It appears that paddy husk is the outer covering of paddy and on its removal, rice is obtained and rice husk is obtained in the process of polishing of rice which contains oil element. In any view of the matter, subsequent Notification is clearly used the word rice husk and paddy husk as two ..... X X X X Extracts X X X X X X X X Extracts X X X X
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